[CTC] How Donald Trump hijacked the Democrats’ best issue

[Arthur Stamoulis]

http://www.marketwatch.com/story/how-hillary-clinton-could-beat-donald-trump-on-his-strongest-issue-2016-09-30 <http://www.marketwatch.com/story/how-hillary-clinton-could-beat-donald-trump-on-his-strongest-issue-2016-09-30>

Opinion: How Donald Trump hijacked the Democrats’ best issue
Trump’s populist campaign is fueled by working-class anger about unfair trade, an issue the Democrats need to reclaim

Rex Nutting  <http://www.marketwatch.com/topics/journalists/rex-nutting>Columnist Published: Sept 30, 2016 11:23 a.m. ET

The Democratic Party could have blocked the rise of Donald Trump years ago if it had just listened.

The story of Trump’s amazingly successful movement is also the story of how Democrats turned their backs on their working-class roots and sided with the elites on the crucial economic question of our times: Who would win from globalization, and who would lose?

The facts are stark. Since 1994, when the North American Free Trade Agreement went into effect and the U.S. began the process of lowering tariffs on Chinese imports, the U.S. trade deficit has ballooned from about $100 billion to about $500 billion a year. Since then, U.S. manufacturing jobs have fallen by about 5 million, and inequality has worsened, with the richest Americans capturing almost all of the income growth.


The U.S. trade deficit has widened significantly since 1994.

Globalization has enriched the already wealthy and the professional classes who serve them. It’s lowered prices for most manufactured goods, helping consumers at every level. And the brand of globalization that is enshrined in unfair trade deals is one of the factors  <read:Why%20U.S.%20companies%20pay%20headhunters%20$15,000%20to%20fill%20manufacturing%20jobs>that contributed to the decline of the middle class and the demise of the American dream that our children will have a better life than we had.

Trump has tapped into this reality, even though it’s far from the whole story. He’s within striking distance of Hillary Clinton because he was smart enough to hijack an issue that the Democrats had the advantage on for decades. Although voters have rallied to him for many reasons (including many “deplorable” reasons), his popularity is due to one thing above all: He listened to the complaints of millions of people, and he gave them a megaphone so all the world could hear: “Trade is stealing our jobs!”

Democrats will have only themselves to blame if Trump waltzes into the White House leading a populist movement that could have been — should have been — led by a Democrat. Although rank-and-file Democrats were practically the only ones talking about the unacceptable costs of globalization over the past 25 years, the elite leaders of the party — especially presidents Bill Clinton and Barack Obama — did little to make globalization work for working Americans.

Decades of inaction by leaders of the Democratic Party have harmed the very working-class people they have vowed to champion. It’s no wonder millions of blue-collar workers have abandoned the party that abandoned them.

But siding with Trump is like jumping from the pan into the fire. Unfair trade is far from the only problem plaguing our economy, but it’s one thing Trump never fails to mention. Trump’s proposed solution of erecting huge tariff walls to protect us from cheap foreign labor would only make matters worse. If he gets the trade war he’s clamoring for, Trump would crash the economy, <https://piie.com/publications/piie-briefings/assessing-trade-agendas-us-presidential-campaign> costing millions of people their jobs and dashing their hopes.


The number of factory jobs in the U.S. has fallen by about 5 million since NAFTA went into effect in 1994.

Trump is nostalgic for an America that no longer exists, an America that we wouldn’t want to return to even if we could. Trump can’t make globalization go away.

How did we get here? It used to be that it was mostly Democrats (along with Ross Perot, briefly) who warned that trade deals were harmful. Republican lawmakers, for the most part, enthusiastically supported them.

It was Democrats who argued that so-called “free” trade deals were rigged against American workers. It was Democrats who insisted that the theoretical benefits of trade were just that — theoretical. It was House Majority Leader Dick Gephardt (a Democrat) who broke ranks with fellow Democrat Bill Clinton in 1993 to oppose NAFTA, saying the trade deal with Canada and Mexico “would exacerbate our worst economic problems: disappearing jobs and declining incomes.”

NAFTA squeaked by, passing with the support of 72% of the Republicans in Congress, and against the opposition of 59% of Democrats in Congress. 

It’s been largely the same for the past 23 years.

Most trade agreements have been opposed by most Democrats  <http://www.citizen.org/trade/article_redirect.cfm?ID=7170>in Congress, who argued that unfair trade would take American jobs. Most Republicans in Congress sided with the U.S. Chamber of Commerce and other business groups that saw NAFTA and other trade deals as good for America because they were good for business. And if NAFTA lowered U.S. wages, so much the better.

If Democrats once owned this issue, how can they get it back? How can they connect once again with the working people who have been left behind? Can Democrats offer a better idea than Donald Trump’s vow to throw up barriers to trade? Can Democrats actually fix the economy?

It would start with some humility. Admit that the dozens of trade deals over the past decades have had mixed results. Yes, America as a whole benefits from increased trade and globalization. But the benefits aren’t equally shared, and the U.S. hasn’t gotten all of the benefits that it expected to get. When trade with China was opened up in 1994, U.S. businesses expected to sell lots of “phones and electronic gadgets”  <http://tech.mit.edu/V114/N27/china.27w.html>to the Chinese!

If only ...

The next step for Hillary Clinton and the Democrats would be to explain how they would fix our trade imbalances. Clinton does have a plan <https://www.hillaryclinton.com/issues/labor/> — including the creation of a trade prosecutor’s office to defend ourselves in court against unfair trade. But she hasn’t made it a focus of her campaign. She should.

Two prominent experts on trade, Jared Bernstein and Lori Wallach, recently published a short and very accessible paper — “The New Rules of the Road: <http://prospect.org/article/new-rules-road-progressive-approach-globalization> A Progressive Approach to Globalization” — setting out a detailed alternative to Trumpism that Clinton should embrace as the campaign rushes toward its climax. You should definitely read it.

“It’s not enough to say ‘I’m for free and fair trade,’ ” Bernstein told me. “You have to describe in granular detail” how to make globalization work for everybody.

Bernstein and Wallach’s core argument is that past trade deals have been written almost entirely by and for multinational corporations, largely in secret. That’s why the agreements are so unfair, because corporations write the deals so they receive special privileges — such as investor-state dispute settlement  <https://www.buzzfeed.com/chrishamby/super-court?utm_term=.jdAAqeZpy#.vgmQJXYmj>courts — that no democracy should tolerate.

Hillary Clinton understands this, at least at times. She’s been talking in public since 2000 about the flaws  <http://www.ontheissues.org/2016/Hillary_Clinton_Free_Trade.htm>of our trade policies. She lobbied her husband hard to reject NAFTA. But her voting record is mixed.

“She’s not her husband,” Bernstein said, recalling that Hillary Clinton told him in the 1990s — while her husband was still president — that she thought trade deals “were handshakes between investors that leave workers behind.”

It’s time Hillary Clinton told us the same thing. And follow it up with a believable and workable plan to reshape globalization so it doesn’t kill the American working class.

She might start by borrowing a line from her husband: “I feel your pain.”

Rex Nutting is a columnist and MarketWatch's international commentary editor, based in Washington. Follow him on Twitter @RexNutting. 
 

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